Education Minister Peter Fassbender said Friday morning he isn’t going to delay a review of the Vancouver School Board.
Fassbender said the government and special adviser EY, formerly Ernst and Young, would proceed quickly with its review to help solve the “chronic issue” between the VSB and province when it comes to the district’s budget planning and process.
“I’m committed to working with the new chair and the new board, as [VSB chairperson Christopher Richardson] has indicated they are, to finding a new path, to getting out of this chronic dysfunction that we seem to have had and the disagreements on budgeting, on capital management on space allocation,” Fassbender said at a press conference. “I see a district with 9,000 empty spaces claiming that they can’t deal with that and we need more portables. We need to take a really hard look at that.”
In a subsequent press release, the Ministry of Education stated it has also directed the VSB to submit its budget for review by June 15 to demonstrate the board has responded to recommendations made by EY.
The provincial School Act requires school boards to submit balanced budgets to the ministry by June 30, but the VSB usually adopts its budget April 30 to advise unions and administrators about staffing changes for September before the summer break.
VSB secretary-treasurer Rick Krowchuk said the district needs to clarify what this June 15 requirement will mean for the board’s budget process because EY isn’t required to submit its report to the province until May 31.
“We have seen year after year the Vancouver School Board indicate that they were going to be facing a significant deficit and an inability to manage their budget within the framework that they were operating,” Fassbender told reporters. “In the last three years, we’ve seen an addition of $5 million every year, even when they announced and they had the public concerned about the fact that they were going to be facing a deficit.”
The ministry noted in a March 12 press release that the VSB reported an accumulated surplus of $28.4 million, or six per cent of total district expenditures, on June 30, 2014.
The March 12 press release from the ministry noted: “As of June 30, 2014, [the VSB] held an accumulated surplus of $28.4 million, which is equivalent to six per cent of total district expenditures.”
“And in some cases to help fund shortfalls for the current or future years,” Fassbender said.
Krowchuk said of the $28.4 million, about $22 million is restricted, meaning it has already been committed to specific purposes, and $5.8 million is listed as unrestricted, or not committed, on its audited financial statements. Approximately half the $22 million was used to fund the district’s 2014-2015 shortfall, and the board has already decided to commit the $5.8 million to its 2015-2016 shortfall.
Even so, the VSB predicts a $14.7 shortfall for 2015-2016.
The VSB attributes its shortfall, in part, to costs not covered by the province.
The VSB decided to continue with PricewaterhouseCoopers’ review of the district’s expenditures and revenues Wednesday evening and to ask Fassbender to delay the review by EY until after the district adopts its budget April 30.
Fassbender said he was disappointed by the VSB’s decision to proceed with its review by PwC, which will duplicate work being carried out by EY.
He had recommended the VSB cancel its contract after he surprised the district March 12 by appointing EY. Fassbender denied knowing the VSB had hired PwC earlier in the month to undertake similar work and offered to reimburse the board for costs related to cancelling the PwC contract.
Fassbender said he didn’t know how much the EY review would cost taxpayers but said similar reviews cost about $180,000.
“I’m not sure of how much of Vancouver School Board’s taxpayer’s money they’ll be spending on theirs,” he said, adding he sees EY’s work as an investment for the future.
Richardson told the Courier Thursday morning the board would benefit from the continuity of rehiring PwC to update its 2012 Resource Allocation Report, comment on the district’s proposed balanced budget for 2015-2016 and identify opportunities for additional savings, even though there could be duplication between the two reports.
Other school districts have said they will struggle to balance their budgets, but Fassbender said he hasn’t decided to appoint special advisers for them.
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